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 [Music] [Music] I'm Charlotte McLoud with investing me.com and here today with me is private investor Don Hansen I think many people will be very familiar with you from our our interviews in the past yes eight of them the beings ahe yes yes so this will be number nine at the New Orleans investment conference where we also spoke together last year that was number five I think there you go yes so really excited to be back with you and you've got a lot of information to share with people today on on gold and silver but

also wider topics as well and I know you want to start with the the monetary system give some background there so so let's get into it okay um what I want to explain to people is that the uh the way International Trade works is that there's three key elements to it one is the currency that's used in transactions another is the aspect of the each Central Bank of the country having reserves that they can use in order to do that trade and the third part that doesn't get thought about or

talked about very much is the intermediary I mean there always is one when we buy and sell things to why we write a check and then the intermediate is the bank who goes through the other bank and so forth and there's there's a system like that in international trade as well and today that system is called the Swift system and it is uh managed by the US government and that will be significant issue as we get further into this discussion so the uh other context I wanted to mention is before we get

into where we are now this to get a little bit uh uh explanation of where we were in the 19th century because we had a very stable World monetary system for 100 years between the end of the Napoleonic Wars in 1814 and the beginning of World War I in 1914 and through that time the transaction currency was the British pound sterling very stable and fixed to the price of gold and the gold was used for settlement and in the system was primarily the bank of England that was the intermediary for everybody okay so that's kind of where

we've been so then I became interested in trying to understand more about his gold is is simply part of or has been part of the system for years so let's look at the system that we have and where it's been and of course what we know is that the the US was the world's Reserve currency as of 1944 in between 1914 and 44 was chaos yeah and all that but in 1944 we created a new system called the brettonwoods for Breton wood Hampshire New Hampshire where they did it and that was a system where the US dollar was the

transaction currency and US dollar and dollar assets were the reserves and the system was the Swift which they developed over time well of course then what happened between 1945 and 1970s is that the system was unraveling because the US was printing money in the late 60s and and basically violating the situation so that other countries didn't trust uh what we had and so at the beginning of the bronwood system the United States had 16,000 metric tons of gold in their reserve and that was way

more than anybody else because the US had been accumulating it because the other countries were at War all the time and they were buying stuff for the US so the US accumulated a whole bunch of gold well that worked very well until the 60s when we had United States government was funding a war and the lynon Johnson's Great Society pres program and so the other countries in the world noticed that at and said whoops this is not looking good I don't want to hold your dollars any or dollar denominated assets

which would be us treasuries instead I want to get my gold for $35 an ounce and when the gold Pile in the Fort Knox got down to 8,000 metric tons in 1971 Richard Nixon says whoops you know time out we can't do this anymore or it'll all be gone so we basically defaulted on that system and so we have a new one so the data that I'm working with starts in 1971 pretty much okay because you got a whole new system so comparing it to the old one wasn't meaningful anymore so we had to start

from there and so what I done then is look at what the the uh various parameters and things going on what they did from 1971 until today so that's where we look at slide one where I started was to look at the US money supply M2 uh which is data you can get from the Federal Reserve very easily and as you can see there the uh US government was printing money and printing it more and more and more so what you were looking at is what's called an exponential curve it's getting steeper and steeper they're

printing it faster and faster each time and that's the reality we are and as you can see towards the end here it's starting to go vertical yeah that's that's that's an exponential that's an exponential curve and and now there's lots of exponential Curves in the universe they're all over the place and most people are not that familiar with exponential curves but they're so important because they tell you something about that system that it can only go so far between when it

starts to go vertical something happens yeah EX okay so then I thought well okay let's look at the US government's debt during that time and so I plotted the debt and the my Supply on the same graph and the thing that surprised me was that they tracked almost perfectly and that I didn't expect that yeah and because here you got this long period of time and all sorts of different things happening and yet the all the points flow right on the parallel curbs obviously there's a very

powerful connection there and my suspicion is and nobody's told me this I'm just and thinking about it and trying to intuitively you what makes sense is that there's an independent variable is the death yeah and the dependent variable is the money supply because what's going on is that the system has to provide the money to Pro sure that you can borrow y so it's got to be the thing that responds to so it's the debt that's that's driving the whole thing and then I wanted to go of course

and to look at gold and how all this was being affected by gold so I plotted the as you can see with the straight line and sure that's the money supply curve and then all the square points are the gold price and what you can see is that in fact the gold price tracked the money supply very closely because it would be go but it would go up above it or below it but it would always come back to it and then at the very end in the last 10 years from 2015 to now it was exactly on track and I'm thinking about I wonder

who in the market finally figured out that this is what was going on and that that I intrigues me you know I'm thinking that's weird how did it how did it get like that all this I don't have any idea but it's it's fascinating to look at that so then I said okay this is a phenomenal predictor of the gold price yeah but but it has deviations and so I tried to understand what the deviations were about because here we had this first period where the gold price was well above this money supply curb then a

second period where it was well below it and then the third period which just started over and and the first period really is about 1975 to 1990 as you can see where there H gets back to that that point and then from 1990 to 2006 it was pretty much under it but then around 20066 it it went over it CU here's 2008 so it went right then and then it went up and then it gets to uh to 2015 is where then all of the sudden it went perfectly smooth there's the perfect one so I'm thinking all right so

here's these three periods where it deviated so why was that and that's where I got into studying some other aspects of which we'll just see in a minute yeah because there were three free factors that that really caused this the most important one was in this slide which is the Central Bank activity the amount of gold that it's buying and selling and it's really dramatic as you can I don't have any data by the way before 1990 on Central Bank activity I couldn't find any so maybe not a whole

bunch was happening I don't know but you can see clearly there that it goes way down and it stays down until almost May 2008 or whatever but heavy heavy Central Bank selling and um and of course that's the period where the gold was if we go back previous one yeah that's where the the gold price was underneath the curve okay now here when it was above we don't know what the Central Bank activity was but the stock market activity which is the second act one stock market was bad and the

inflation was high which is the third one but they're in that order in terms of influence the central bank then the uh stock US Stock Market and then inflation so okay then we go into that period between 1990 and 2006 where you had the uh uh stock market let's see no wanted n h yeah the stock market was very strong during that period of course yes inflation was low and the Central Bank selling was high and that's why it was under okay then we get to 2006 in which things then began to

change and for that next period all the way to 2015 Central Bank buying was high as we can see from the previous slide oh and the uh stock market was weak that's when we had the so-called great financial crisis 0809 and all that and so and yet look at here what we had the big a huge increase in the central bank's volume so that's why B old was above the curb and then we get of course to the last St in which they are kind of together but that period was weird in that both Central Bank buying was was

strong but the uh stock market was strong too as we know and is where we are at this point in time so um I feel like that kind of explains so you can say okay then we can look at the money supply curve but then we can look at those other factors and say well where are What are they telling us in terms of where we would think that that said the gold price would then be higher than that or lower than that based on our history so there we go okay so I I love the sles always and I I think they're so useful

for everybody else to get the visual fiture especially to have you you walk through it there's another tidbit if we go back to the to the that one here you go gold Central Bank and buying I thought that some it would be interesting for our audience to know uh the context of that because the the gold Supply in 2023 for example okay was 4,800 metric tons in one year okay but here we have in these last couple years okay where it got really high we're looking at 1100 tons a year of Central Bank buying that's like 25% of

the total annual Supply when you think that prices are set at the margin and then you have that big a bump it's no wonder that the gold price went bananas in late 2023 because you had this huge amount in relation to that and so we shouldn't be surprised that that happened this was I mean you know this one was keeping it up but when it at that then you knew we were really really going bananas yeah and of course the reason why that happened it was 2022 is when it started well what happened in 2022 the Ukraine

war started and what did the US do because they dominated the Swift system they basically requested $600 billion of the Russians money and the other countries in the world said you know what if we do something the US government doesn't like they can do it to us too and then when they did that yeah yeah now another interesting thing just to in terms of this when I was looking at this Supply hey man of that suppli 4,800 tons 3600 tons came from mines 1,200 tons came from what was called recycling well I looked at that

and I said now wait a minute you if this was copper or silver which industrially used you would see okay we're going to get recycled because all the stuff the Dr but gold isn't like that so I looked up what that was 75 or 80% of that so-called recycling was from India and China where people were basically turning in their jewelry and that makes all the sense in the world the thing is that people in India and China when they save with gold they don't use bullion coins and bars like we do they do jewelry and have for

centuries especially in India so what you're seeing there with that recycling is the fact that in India and China Gold is very much money because people have that savings and when they want to buy a cell phone or a suit of clothes or a car or whatever they can take that and go to a dealer and the Dealer will pay him so much for so it's it's it's not different so it just shows you the extent to which gold actually is money in other places in in the world and that's I was really

fascinated by that yeah and it it's not typically what you would think of when you hear recycling so yeah that makes sense it's it's not really what we normally think of is recycling it's just merely a way of Indian and Chinese people using their savings to exchange for local currency to buy the stuff that they want to by so yeah that was I thought that was kind of interesting yeah I think that does add context for everybody and everything is really starting to come together I think all

all the information always you know you start at one point and then everything starts to fit together exactly so so yeah we've looked we've looked at your your charts the first five slides here that are looking and telling us what happened in the past but I think you know also they paint a pretty worrying picture for the future when it comes to de and I know you've got information a lot of research on the implications of a high debt to GDP ratio so maybe maybe we talk about that and I know there's

there's kind of a Tipping Point in there that you've spoken about yeah uh there's another slide that that we haven't looked at that I would want to make a bit of a mention which is sh number four oh number four that's where we have I plotted the US Stock Market this is number four that's uh okay number five would yeah there we go five and and and what I thought Drew from that because there's all kinds of points and and and drawing lines what wasn't going to help me

understand anything better because the the gold price and the stock market were going all around they weren't like the uh money supply and and the debt which all very perfect but these are because these are markets yeah you had all sorts of activity but I thought what was interesting to get an idea is to to look at the the periods and down below on the left what you can see is that I thought well right what is the relationship between the gold price and the stock market because we said I said that was a

a factor it's it's it's not as powerful as the uh Central Bank buying but the thing that I learned is that when you look at this there's actually an almost perfect negative correlation between the gold price and in the stock market because look at here's the first period and here the gold was way up and and S&P not so much then it flipped then the next period it flipped again then the period after that it flipped again and now here just recently it's been kind of even Steven just like we saw you know

but the so that's really important I think because then it means that where are we about to flip too we've been with lower gold and much higher stock market the stock market Market is very very overvalued the um Buffet indicator which is a market cap of all stocks against the GDP is at all-time highs we're we're about to flip on the other way yeah which again for gold investors you look this is this is what the these this date is telling you okay the stock market is going to go down and when it goes down

the goal is going to go up because it it has four different times it's followed that pattern of that negative correlation and that makes a lot of sense because the US Stock Market is so huge the US stock market's total market capitalization is probably equal to or more than all the other stock markets on the planet and there's a lot of foreign money into the US Stock Market so it's a it really then if the US Stock Market is going down where's that money going to go and because the gold market isn't

very big it doesn't take a whole bunch and that's why you see those big flip flops yeah okay so I wanted to make sure realiz what that's telling us about what we can expect to see in the gold price yeah yeah I I tell you all the time I'm so much less of a numbers person compared to you but when I see this it makes complete sense yeah with pictures are so much more useful than words p and all that so yes okay so then let's go to the issue about the debt to GDP because yeah what what I think I want to get

into there is is really saying what is our future going to look like given all of this and and and the the key piece I think is that the debt is is the Achilles heel of the system and so we really need to look at that and and what it what it means and and the primary way that we look at the significance of debt is to relate it to your income as we do as individuals how much debt we have in relation to how much salary we've got the same is true with companies or with governments and the way with governments

we look at is the uh the the government debt versus the GDP which is the the revenue side and what we know from history again looking at that particular number is that in 1945 after the end of World War II of course we spent lots of money on the war and so forth the Deb ratio for the US government was 111% okay by 1975 it was down to 32% and now it's 124% okay so some people were going to say to me well gee we got it down before so why can't we do that again okay well there's there's some very powerful

reasons for that the circumstances are completely different and the most important one is demographics between 1945 and 75 we had a young growing population life expectancy was maybe late 60s yeah so we didn't have huge expenses for Social Security and Medicare barely started and so we had a great opportunity to grow GDP also the US was a dominant economy in the world Japan and and Germany were totally destroyed so we could pretty much call the tune so we made a lot of money and bu the American Business was thriving in that

time and the GDP was growing and the debt was not growing very much because the budgets were relatively balanced why because we were r a goal standing yeah remember y yep from 1944 until 71 so you didn't see that except it got abused in the late 60s which is why we ended up bailing it but for a long time the United States government had a pretty balanced budget so the debt didn't grow much and the GDP grew and that's how we got down to 32% today it's just flipped yeah now we have fewer

births fewer younger people working and and much larger conention of of people just in numbers but they're also living longer so you've got the Social Security Medicare a whole lot bigger so and then you got this big debt and with the interest expense so those two together are huge numbers and and some people including the Congressional budget office projected by 2030 Social Security Medicare and interest expense will will consume the entire revenue of the US government right so when we talking

about where we're heading that's where we're heading it's it's it it's not a very pretty and that's not assuming a recession we they're assuming 6% budget deficits every year okay and you have recession they'll go to 10 or 12 cuz that's what happened in 20089 okay yeah and so um it it's not uh very encouraging for younger folks like you it's really not you know I walk away from these conversations like oh dear well you know the honest truth is that I

was born at the right times yeah at a point where my almost 84 years in a couple days the world was very beas ful it was very prosperous and everything was goody goody but the people who were lived 30 years before me went through the Depression and World War II and on and on and on and as the book forth turning tells us we're in one of those fourth turnings again if a lot of your audience may be familiar with thren House book that came out in 1998 I think so anyhow yeah but that's why we need to

beware of what's going on so that we can protect ourselves as best we can I mean that's all you can do you're not going to fix the way it is you and I but we can do things that allow us to have it the best that we can for ourselves and our family which is why we Advocate people own gold yes so here we are yeah okay so let's see let's see where else we need to go we've got even beyond the us we've got central banks around the world ramping up their purchases we know countries like the bricks are looking to

reduce their dependence on the dollar do you have other trends that you want to talk about there well one of the things that I thought would be interesting yeah was in in the yes I do but I would like to show this slide because I found it interesting and what I did was I plotted the GDP versus DEET and of course it over this is time growing and you can see how it got less and less steep you yeah which is so it's exponential in Reverse you see that yeah good one and and and the reason for that and the

reason why the U GDP and the money supply look this way I think is because what we're looking at is an example of the law of diminishing returns which we know about that it applies in a lot of situations because What's Happening Here is that we're trying to get the same output from the system in terms of the increment of GDP growth but at each successive time we have to put in a little bit more debt and a little bit more debt each time in order to get the same amount that's diminishing returns

we're getting less return for each additional increment of debt yeah and that's that's what we're looking at that's what we're seeing and and I I thought that was interesting because the law diminishing returns is is it's it applies in so many different situations and and I think that's what we're saying again that that's just me I've never seen anybody else talk about that but I like to think in terms of science and physics and whatever and say oh how does

that relate to something else that I know yeah and hopefully you know sometimes we get some comments people have ideas maybe people write in their ideas yeah I hope so yeah but I try to point out when something I got from someone else and whenever I basically came up with it and said well this is what I think but you know I don't have any documentation that supports that but that's what's fun for me to do this like well maybe I'm seeing something that other people aren't talking about BR

much and that helps then the audience because then they learn something new yeah yeah yes of course okay so let's see where were we then um yeah um I think another piece that I wanted to talk about on the GDP issue just kind of elaborate about that in very recent period here we had uh from 2020 to 2023 yeah we had a GDP growth supposedly of 2.7% okay but I think it's interesting for most people to to know how do you calculate GDP okay yeah how many you know that well it's composed of of basically four

numbers consumer spending is by far the largest in 2023 it was 68% then it was business investment was 18% government spendings 177% and then the net of exports and imports and because we were importing more than we were exporting it was a negative number of 3% and that give a 100 so then in looking at the uh GDP for 2023 I'm wondering about well what is that really telling us and and so I looked up what government spending was in the last eight years oh God from 2016 17 18 19 that 4-year period

the average government spending in the US was 4.1 trillion okay 2020 21 22 23 that fouryear period the average was 66 trillion a 60% increase oh but then wait a minute government spending is in GDP well what happens if you astronomically expand government spending then the G the gbb grows and the money the government spent goes to people who buy stuff so the consumer spend it goes up so what you're seeing is that the GDP growth we think we had to me it looks like an illusion you see what I'm saying because

of the way you use the numbers the government and that's and and and in fact even the the jobs numbers that the Biden Administration puts out most of the jobs even new ones are part time yes and the fulltime that are new ones are either government or Healthcare yes especially government yeah but the private sector is not doing anything yeah so that's why I think we're on the verge of a major recession because the private sector is hurting yeah yeah yeah and and and you've got all kinds of private sector debt that's

going to be coming due because commercial debt particularly is only five year and they triy to extend and pretend all that stuff but when that starts to come in and the con can't renew it that's going to be a problem so yeah yeah so where do we go into what uh we go the next step do want to talk yeah let's let's talk about what is the recent past telling what is the recent yeah I think we should go there I think that's interesting and yet it relates partially to the earlier uh curb

where we saw what the Central Bank buying and all the rest of that oh yeah because what occurred at two in 2010 yeah was a major change that that was a really pivotal period where the central banks completely changed the way they were what they were doing and by 2014 the central banks of the world have not increased their Holdings of US debt Securities at all instead what they've been doing for their reserves is buying gold God why yeah but not us debt Securities so who's buying the debt

Securities well of course the FED bought a whole bunch yeah after the GFC so they expanded their B balance sheet all the way up to like $9 trillion or something they tried to whittle it down some since but still and and another thing that I thought was interesting was to look at who was buying the US net true Charities and of the foreign buyers there were three there was London again financial center for the whole world Luxembourg hardly any people live there so it's already you know the who knows

and the Cayman Islands to get the drift and the thing is central banks when they were buying treasuries were long-term holders they were just they wanted to have these Reserve assets but they wanted to get a return so they weren't trading it or anything they were happy to buy 10 or 20y year 30-year treasuries these guys now the Cayman Islands and the Luxembourg the hedge fund types they don't want to do that that's why Janet Yellen has been selling so much of the US dead at the short

duration because that's what they want to buy they don't want the law on they don't want the others but that's but then that be makes makes the whole the debt thing the turnover become you know that you're rolling more and more of it more frequently because the durations are shorter yeah but that makes it really vulnerable then to what happens with the interest rates yes so I thought that was interesting and uh it just shows that the US government is having trouble finding buyers and we'll get into that even a

little bit later in the same discussion about this um the um the thing that's also happening because it it involves the bricks of course because these are the countries who decided to do this and and and so they have been developing their own version of the Swift system yes because that was what the US used to basically steal the money from the Russians so they said okay we we going to have to have our own and that's taken a while for them but they now have that they now have that and the other thing

of course that they've been in the process of doing is traing with each other in their own currencies especially the Chinese which then they need to do that because they have very few resources and as their exports go down they have to still import food and energy and all these other things and they don't want to have to be go out buying dollars because that's going to hurt their currency so they need to trade in their own currencies and so what they did then was create something called the Shanghai

Gold Exchange which is now in operation yeah and the way that works is China will trade with another country and sell their Manu ufactured goods and then they'll get soybeans from Brazil or oil from the Saudis or Russia or whatever and if there's any disparity between how much they get and receive then there needs to be a settlement and the way that happens is that the countries the country that has the extra goes to Shanghai and exchanges it for gold that's the reason why the Chinese

created that so that they could do that but does that resemble something that we talked about at the start of this in fact a lot of people are carrying on about the bricks are creating and they're going to create a new currency no all they're deing is just recreating what we had in the 19th century was is pretty much the same thing that's all they really need to do and that's what they're in fact doing so a lot of this other discussions about yeah trying to these desparate countries because the

bricks are not that un unanimous anything but they are unanimous and they want to get out from under the dollar yeah and all they have to do is what they're already doing which is they work with their own currencies and and they do settlement in Gold yeah okay so we don't have to wait for this bricks we don't have but we know already it's already here but most of us aren't aware that that's already well down the path and it's going to keep going yeah yeah people will be surprised but I also

don't think the dollar is going to go away right this it will still be used in transactions but the thing is people are doing transactions are not holding the dollars they don't have to so even if the Dollar's value goes down it isn't hurting them any they just exchange it for gold or something else yeah so there's no reason to say to think the dollar is going to go away right now I think it may be a long time before that ever happens but for the bricks countries they don't care doesn't matter

uh you'll enjoy it yeah Smart Guy this is very fascinating and I think a lot of pieces of information that people wouldn't necessarily know or know how it all fits together any any other points there on bricks and what they're doing um there in terms of what's actually happening now yeah something that has happened in the very recent past the Federal Reserve as you know lowered the FED funds rate 50 basis points about six weeks ago two weeks after that the interest rate on the 10year treasury went up 75

basis points oh wait a minute that's not what that's not the way it's supposed to work and so we don't know yet we don't what's going on there okay but there could be a lot of explanations like is the Fed losing control is the Fed having trouble finding buyers what is it we don't know but that's very very big deal because everybody's looking at that saying that that that doesn't make any sense there's something happening here right now maybe it's an anticipation of a of a recession

in the US which is going to affect the value of the dollar and all those other things but yeah we if we have a recession the dollar value will be endangered because of several things but the main one is that there's an awful lot of US Stocks owned by foreigners if they want to sell what do they do they sell dollars and buy their currency to bring it home yeah so you you so you got a A vulnerability and also the U stock market is vulnerable not just because it's highly valued but because an awful

lot of the value that's there came in in two places one is stock BuyBacks right right right right enormous in in enormous influence and the other is passive investing which has also increased enormously so that you have you know how that works of course then capitalization weighted indexes so all the money goes in to the mag s but and that so then they go up and up and up but in Reverse it goes just as fast if in the downside so that's the vulnerability so we got several three different vulnerabilities to the stock

market at this point in time that can affect it and make it the correction a lot worse because of both the DI BuyBacks and the large amount of foreign holding because and that's the foreigners owned a lot because all the other stock markets in the world weren't doing very well and so they all brought their money to the us so you got a situation that's very vulnerable to going down which is going means that because of the negative correlation with gold Gold's going to do well okay so so we're getting I know you

always like to give people you know all right here's all the information now what do we do is it time to talk about what do we do absolutely and I'm I'm so excited to do that if people had a pen and P paper I would like for them to take just a little bit of notes so they can see it CU I couldn't put it easily in at Graphics form but let's look at the um valuation of gold mining stocks today okay and the way I like to look at that is to calculate the change in profitability compared to the change in

the market price of the uh my gold miners index I use Hui as a reference okay so sep I use September 30th because that was recent and it was an easy and it it per fit perfectly with what I was trying to explain September 30th of 2023 the gold price was $1,848 okay September 30th of 2024 it was $2,653 okay all right so if you want to calculate a uh in a way of looking at the profitability approxi for that I use the calculation with the Allin sustaining cost which you know is basically all the cost to produce gold

except for GNA and taxes but those get complicated so it it I've used the this method for years and it I call it a gross margin and it it works really well to get a good sense for profitability for companies and everything so I use the average all in sustaining cost for the gold mining sector which is about $1,300 I'll pick a easy round number to to work with Okay so what you're seeing then weing with the uh index in September 30th of 2023 the gold price was 1848 subtract 1300 you get

$548 for the gross margin at the end of September 30 2024 the uh gold price is 2653 minus 1300 is $1,353 per ounce okay yeah so what you're seeing is that the profitability then when you look at the $353 that the profitability went up 157% I've been using my channel I think quite significant but when you looked at the Hui index it went up 47% in other words you could go up 3.3 times to get to 15 157 you see yeah yeah so that's what I call opportunity and and you might ask me well je why is this

there already because it just the gold price just went up there nobody knows about it and they're busy buying and selling or mostly buying Nvidia etc etc right and or Bitcoin or something so nobody knows and and most people don't even know how to spell gold anyway so it's it's it's not it just hasn't arrived yet when when you do have a correction in the stock market and people are going to begin to look at D mining companies and think my goodness look at how profitable they are and and

just to give you another indication of how skewed we are the last bull market in Gold we had was between 2002 and 2012 okay well be the average of the Hui index at that time when compared to Gold it was 2.3 okay now it's 8.3 that's because the denominator which is the Hui index is so much smaller that makes the number larger when the denominator is smaller if you see how much it that's another indication of the three times thing that we're off that we should be reating gold miners by factor

of three times okay and we're all just a little impatient is what's well yeah but you have to look at the context okay this has just happened it and so it what it it means is that we are at a critical point where this is a phenomenal investment opportunity and then the other way I looked at it is that the Hui is an index that has all the gold miners The Good the Bad and the Ugly you know if you do a little homework you can kick out the best ons yeah and the ones that I like best are the ones that are not only

profitably producing they're in low cost is a all any cost is in the bottom quartile they're in good locations they have good management and they have exploration projects within their corporate deal which if they develop and get it into a m would double their production in like three years or less yeah and they were they would be able to it and without all the headaches of a normal exploration developer because they don't have financing problems because they're already making a lot of

money and and they don't have permanent problems because they've already done that already and they don't have employee problems because they already have mining engineers and geologists which are in short supply because of the last bare Market in mining the miners and geologists either died or got another job and not enough young people studied that and so that's another whole issue in the mining business is where are you going to find people who have experience to build and operate mins

yeah but if you invest in one is already producing all of a sudden those things are all taken care of so that's my strategy is U what I have been buying and focusing on I investing on yeah and I will I'll link to the previous interviews I'll I'll leave links under this video so people can go find them because you go into much more detail I think of process in in those yeah yeah yeah okay okay so this is what people can do we looked at the past we looked at the future we looked at what people

can do is there anything else on the gold stocks should we move on to I know you want to touch a little bit on us election and and kind of some current events Before I Let You Go um um no I'm not I think I covered most everything on the on the on the gold stocks I could name a few names if you wanted me to I think people would really enjoy that if be want to my my three favorite uh gold miners that are producers and all that it's called K92 mining has a project in Papua New Guinea a very a good country to be used to be

part of Australia 90% Christian country speaks English another is a company called G mining Ventures that's a fascinating company because there was a a French family and I can't remember their name but it started with G and their business was basically building mines for other companies cuz there would be a lot of big companies the agnu eal and all these kind of guys who didn't have all the they didn't want to hire all the people that might build the mine so they would hire a contractor and that was this

company and the family decided this is a bull market and gold you know instead of building the mines for everybody else we're going to do our own okay and so they've got a project in Brazil and it has phenomenal growth potential and that is if anybody is going to bring a mind in on budget in in on time it's going to be lamb and they got lots of money because they've been very successful which is the other aspect and the third one I like is called AIS Mining and they have uh in uh on the gas and that

Northern uh South America with project that has growth very substantial growth protection but there's several things I like about that one of which is that the two Founders and CEOs are legends in the mining business one is Ian Telfer gold Corp remember the other is is a man named Neil woodier who's also a heavyweight and they the ones who have put this together in building this project and that has a lot of growth potential as well but their cost are a little higher than the other the first

two okay uh but fantastic the other one in the silver space that I like is AA gold and silver which is an incredible buy right now and I'll I'll explain why okay they they have a silver project in Morocco which is a wonderful place to operate by the way and and they are expanding their production from 4 million ounces of silver to 8 to 10 I can't remember exactly where they're in the process of transitioning to that and they had some bumps and and some issues and so they had a bad quarter and the stock in the

last months went down like 35% which for a company that had a a Canadian $ 1.5 billion market cap was a big hit but what it is is an incredible buying opportunity for anybody who's interested in it and one of the reasons I like them is that they have another project in Morocco that is even bigger than any of the other silver huge and it's byproduct is gold and it's an enormous project and they have all kinds of money and and and they have the fabulous manager who's been highly successful build a gold project on in

Molly the Ben wallel wonderful manager I've met him personally and his staff he's a terrific CEO and the ownership of that company is is a real amazing deal I met with him and Sean and I and Brian London whatever met with Ben W in March of 2023 at pedak in a in a hotel where Ben W was staying and and he told this great story and and I think it was Brian that asked him well aren't you concerned that you know you're going to you know be a hustle takeover of your company and all that because you got all this stuff

going and your price isn't very high he says well not really because insiders and management own 52% of the stock and I look at the deal of who the Insiders who the directors were one of them is the retired CEO of a company in Germany called BASF it's the largest Chemical Company in the world you think maybe he's worried about money I don't think so no and and so and he and he's built the a very quickly and I can see why because he's really a good delegator which is my always indication of a good

manager because that's what you do yeah you know if you have to delegate let your ego go and recognize you need to hire people who do things that you don't do as well and and give them the authority and responsibility to make it happen then he's really good at that so if anybody is interested in in getting into something where I think it's really undervalued in a very short term yeah look at a okay okay some very actionable advice there and and really good to go into the companies so thank you for

doing that you're very welcome okay do you do you have any final points before we let you go well okay I guess you can uh some people have asked about um what is the uh impact of the recent election in the US lots of people you know and and the honest answer I think is probably not very much and the reason is the fact that what we're looking at if you look at all the data here and you see where the debt the debt is is driving the bus okay it's baked in the cake it's going it's going

to take out its its its process and the only way that the US government is going to be able to cope with this I mean they they either default on it which they're not going to do because that would create all kinds of unemployment and debt and defaults and everything or they inflated away that's what they they always tend to do now there's there's various ideas about how they can make that work least for a while one of them that I've thought of is that they can basically Force excuse me US investors

to buy it and how they do that very simple us investors have lots and lots of money in Iris and 401ks and they get a tax benefit for them they don't the capital appreciation they don't have to pay any tax on that until they take it out so all the government has to do is say okay you guys are benefiting from this Benny we're giving you but what we want you to do for us is you have to own 20% of your assets in your iris it's got to be in US treasurers okay but the downside is that if you do that then the

people who have stock in the IRAs are going to have to sell them to buy the to buy the treasuries and then the stock market's going to collapse and then government's revenue is going to go down and the deficit is going to go up and you aren't going to be any better off so I don't think that's going to work but who knows the government does a lot of dumb stuff at least in the short run that might help I don't know but there's another idea that I heard that is very interesting and that is that the

author of this idea says okay what government should do the US government has 8,000 metric tons of goal right okay why don't they issue government debt Securities backed by gold a more okay do you think that would happen no no I think that point it's but it's a it's when you know extreme extreme circumstances produce extreme that's true actions that's why it's really not smart to say well it won't never happen because we're in a period of time where there's a lot of things

not going to happen nobody thought Trump was going to reelect it either so I mean it's it's it's uh it's it's really difficult to see what's going to happen but the benefit from that yes is that then they would not have any trouble selling those Securities and the interest rate would be a lot lower because you don't have inflation risk premium that you have to add to the interest rate and you don't have default premium because all you got to do is is just cash it for gold if you want to so

the interest would give be le less which means that then the interest expense would be going down so it it it would be and unless you run out of gold yeah or you know and so how is that going to I don't know but I thought it was a very interesting idea it is as Ser you know what because some people are saying geez the US has got all this gold why don't we pay our debts with it somehow okay somehow maybe the government would do that I don't know but anyway since you asked as what could

happen a lot of things but I'm I'm almost certain that our future is inflationary because they have to pay for all this de and of course they did after the great financial crisis where they did that was the quantitative easing euphemism there that that they use to basically print the money to buy it and explode their balance sheet and we get another recession they're probably going to do that unless they do some of these other things but so it's it's it's it's really

difficult to know what's going to happen but I'm very very intrigued to follow up on what happens with the longterm interest rates yeah going up and the shortterm going down and what that tells us we that's s a recent occurrence that there's no way to know yet so we just keep your eyes on that one and see what what that tells us but in the meantime the price of gold is going to follow the money of ler and it's going to go out and the mining stocks are extraordinarily undervalued just act on that and you

should be able to maintain a reasonable lifestyle for yourself and that's what people should do okay I think that's a great place to to wrap it up thank you so much for for going through everything I know people have been asking when is dawn coming back so here you are and I think that could possibly be the most extensive and best one yet so I hope that people there sure hope so [Music]